today than we were in the first half of october. >> we are not going to get a continuation of this upward movement. thee will pick up a loss in second half of the year as people get back to normal. >> normal doesn't look like january 2020. the world is different. >> people can spend, and i think they are going to. >> we can face forward into what i think is going to be a very big 2021. >> this is "bloomberg surveillance" with tom keene, jonathan ferro, and lisa abramowicz. from new york and london, for our audience worldwide, good morning, good morning. this is "bloomberg surveillance, live" on bloomberg tv and radio. alongside tom keene and lisa abramowicz, i'm jonathan ferro. with equity futures advancing a little bit, we start this morning's program with just a little bit of good news. tom: we will get to that in a moment. , futures to make clear

were up, and then lifted nicely at the pfizer announcement, 1.11, up 12. we are near dow 30,000. to me, the clarion idea is that the vix is peeling away the fear , the volatility that is out there come up with a vix at 22.01. jonathan: wejonathan: have been doing that since the election, and the move got a big boost of the pfizer news from last week. the final efficacy rating, and the number is decent. lisa: 95%, better than the initial read last week of 90%. --s is the mark on brands this is the more comprehensive data. of over 65, so preventing illness. an incredibly good display here. the interesting thing to me is that we are not seeing more of a reaction in markets. it is already baked in, and in

fact, you are seeing bond yields a little lower on the day. they are just flirting with this idea that long-term, we are not changing the scenario, even with this incredibly good news. equity futures are elevated on the s&p 500. a big move in the equity market. we stayed elevated over the last week. 10 year treasury yields have unwound the move from last week, almost all of it. on twos-tens, that yield curve is now basically in line with where it was last monday before the pfizer news came out. what is the bond market telling you right now? tom: the bond market without question has been the most supple of the markets. to me, you are right. the depth of the bond market indicating this balance between what we see in the economy, and critically, the no stimulus washington, and what is

percolating wednesday. are we on wednesday? in my right? jonathan: well done. tom: it has been a debate about not if, but when the fed will act. that is a change from early november. ,onathan: wednesday morning seven: 03. let's bring in sam says ellie -- morning, 7:0 three. let's bring in sam fazeli. what do you see in the details? dr. fazeli: quite a lot of interesting angles. ofobviously see the details the efficacy in the elderly population. this is the group of people who suffer most from the disease, so ofve 94% reduction in risk cases of covid is really positive. we had not seen this. we had been speculating until now. the next thing is the side

effect profile looks quite interesting because modernity gave us some details, and it looks like it is better tolerated than the modern of vaccine. moderna gave us some details, and it looks like it is better tolerated than the mother and -- then the moderna vaccine. it may be slightly safer. tom: where do we from 400,000 purchase bits? -- 400,000 participants? there's placebos, i get it. what happens after this good news? do they throw it into the hospital? is it something more sophisticated than that? dr. fazeli: i think the way i think about this is there's two ways to do this. you either decide what we are going to do is use vaccines to put out the fires, so vaccinate where they are the source

of infections, so the younger population, to stop the transmission of the virus. on the other hand, which i think they will do, they will go for the health care workers who are exposed to inordinate amount of virus on a daily basis. that is about 16 million folks in the u.s.. then go for the elderly, which is probably what they are going to end up doing. lisa: what are your thoughts based on the results, that they actually showed improvement rather than the opposite, which is normally what you see when you broaden out these studies? dr. fazeli: indeed, that is something worthy to remember. at least it didn't get worse. it might have been that greater thenis was 90%, but that is a great positive here. we've only got 50 million doses they are going to be able to

distribute by the end of the year, so i am expecting that is what is available for about 25 million individuals . that covers the health care workers and some perhaps people in nursing homes, etc. jonathan: great to catch up. let's hope you are back soon talking about more great stuff. for our audience worldwide on bloomberg tv and radio, pfizer showing its covid-19 vaccine to lived infective, they the equity markets days. -- we advanced 0.3%. joining us now is gabriela santos, jp morgan global market strategist. sidelines, what is left to allocate? there's quite a lot actually. money market funds had an increase after the pandemic hit of the $1.2 trillion.

really since the middle of the year, that started to get deployed slowly, but you still have $700 billion extra on the sidelines, waiting to get deployed. so i think that means any sort of pullback we have in the market, when you see days with more bad news, it gets absorbed by this cash being deployed. it is especially your hardest hit sectors, your more cyclically, economically oriented sectors and regions that are going to see the biggest bump from this cash being deployed. on the same side comes your higher risk credit, emerging market data as well. ago,back to 2007, 13 years i believe the math is. index really hasn't broken out. it is now the time? gabriela: i think there are so many stars aligning for emerging markets. first you do have this

visibility of a cyclical upturn forming next year and beyond with the vaccine news. emerging markets are still cyclically oriented, over 50% of the index. number two, you have the results of the u.s. election, and which we have a president-elect biden that to us and investors represents a return to more orthodox, clear foreign policy. that is huge for your very trade oriented e.m. number three, you have central banks, whose reaction functions have changed so much, in which case you can have good news and interest rates still stay low. that is a great set up for emerging markets, not just the ones that have led this year, which is north asia and technology, but a broader set of emerging markets. we are extremely bullish on ian ,quities -- on ian equities debt, -- on e.m. equities, debt, fx. ethics -- and

lisa: the bank of america survey says we are getting close to full bull, and yet you have howard marks of oaktree capital coming out with this quote yesterday. "when the level of optimism is high, there is usually room for disappointment." can you square the optimism with the reality on the ground of a pandemic that is only getting worse right now? gabriela: i do think in the very short-term, we are very much do for a tough time. we see cases rising significantly across the united states. very high cases in europe. that is going to restrain the recovery here in the fourth quarter and the first quarter. but i think the vaccine news is good news because it gives investors the freedom to think less month to month and more 12 months out and beyond, which is what we should be doing. we shouldn't be thinking about the here and now so much. we should be investing for the future. that is why i think you can have a difference where cases do pick

up in the short-term, but the market is able to absorb it better looking into the future. it doesn't mean there won't be pullback. as you mentioned, there is more bullish outlook now, but a much more normal pullback of 5% to 10% instead of the bear market we had last time cases were rising. jonathan:, calling our guest is lisas -- jonathan: being rude to our guest, calling our guest consensus? rude?gabriela, was that gabriela: i think jon is starting to start stuff. [laughter] jonathan: maybe that is what jon is doing this morning. at him, women upset that is really good, jon. it looks better on radio than on tv. [laughter] jonathan: i've lived it before. i'm used to it. there's nothing new about that.

dollar china, can i go there? from the end of the year, what is left to squeeze? gabriela: we think the chinese --n has pretty of room has plenty of room to appreciate over the next few years. that is as you get an upturn in the global economy, you get the more friendly outlook of the u.s. election. beyond that, you have the more anduan getting more added into investor portfolios. you have more and more investors also wanting to invest directly in chinese equities and bonds. that is also a structural of the to be one currencies that appreciate the most over the next decade. tom: let's talk about the brazilian scream, and that is not you angry. it is ferro. the brazilian scream is when you get strong brazilian rial, strong taiwanese dollar, and

they start screaming about weak u.s. dollar. are we closer to that, or do we have patients up to 2022 on weak u.s. dollar? gabriela: from brazilian perspective, it is the second worst performing currency this year. it has depreciated close to 40%. there is much more concern about the depreciation then there is for any sort of nascent appreciation. there is still the concern about the weakness of the currency feeding into higher goods prices, higher inflation, and a vicious cycle with higher interest rates, so i think there is plenty of room for the real to appreciate further, and brazil is a very cyclical currency, a cyclical market, so it is part and parcel of the cyclical recovery that we are seeing in global markets. in that sense, it is very much welcome. jonathan: great to catch up. appreciate your time, as always.

gabriela santos from jp morgan asset management on this market. equity futures advancing on the s&p 500. we advanced 0.3%. two private companies are going to battle it out for a higher efficacy rate. that is great. well, buts is down as nevertheless, nice comp sales. you've got the boeing news over the laying that. somebody has got to get on a plane. we will see what happens with that approval. but i agree, it is about vaccine therapy. what is important to me is it has been three announcements back to back. it is not spread out. jonathan: there is some real urgency right now. tom: well said. jonathan: it is the reality of the moment we are in right now. yesterday, the white house covered task force, i will quote it. "broad community spread across the country reaching most counties without evidence of improvement, but rather furthered here you ration. --

further deterioration." that is from within the white house. that is the concern. tom: futures up 12. that's all you've got to know. they advance. jonathan: from london and new york this morning, good morning. for our audience worldwide, this is "bloomberg surveillance." with the first word news, i'm ritika gupta. pfizer says a final analysis of clinical trial data showed its coronavirus vaccine was 95% effective. that clears the way for the drugmaker to apply for the first regulatory authorization of a vaccine. pfizer and its partner biontech says it is effective in people of all ages and ethnicity. president trump has fired a security official who went against his claims of election fraud. night, theet last president said that his -- in a

tweet last night, the president said that his comments about election security was "highly inaccurate." he had said to the election was one of the most secure ever. boardcounty election caused a national uproar when republican numbers block certification. state officials have been asked to conduct an audit of some of the precincts. michigan was crucial to joe's victory. could still track to consider the nomination of judy shelton to the federal reserve board, but it is unclear if the result would be any different. the senate handed majority leader mitch mcconnell and .resident trump a major setback u.s. regulators say the boeing 737 max can safely return to the skies. the plane will resume flights after a grounding

two fatal crashes. best-sellings jetline. global news 24 hours a day, on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries. i'm ritika gupta. this is bloomberg. ♪ >> we need the fiscal stimulus. we needed relatively quickly because i can see where the second wave is coming. you can see consumers bending beginning to get impacted again. >> from london and new york this morning, good morning. alongside tom keene and lisa abramowicz, i'm jonathan ferro. want to turn to the price action at the moment. for our audience worldwide, this is the story right now. equities with a lift off of the back of some pfizer headlines. in its final analysis clinical trial data, it's vaccine was 95% effective. that is the good news this

morning. futures up 12. we advanced 0.3%. in the bond market, treasury yields unchanged at 0.8652%. the story of the yield curve, last monday before we got the initial pfizer news, the yield curve, 67 basis points the spread between twos intends. -- between twos and tens. that yield curve is not confirming the rally. that has rolled back over again. do you need the bond market to come with you if you are longer? tom: it is simply the desire for the fed to step in here. i go to the research note of the ,eek at standard chartered making clear this is a fed that could act before the december 16 meeting. there is just a belief that the fed to the rescue again. right now, with a terrific newsletter this morning, let's get a washington update from our chief washington correspondent kevin cirilli. there are so many different ways

to go, i am going to start with an open question. what is the to do list for the president of the united states this wednesday morning? toin: he was supposed to go mar-a-lago for thanks giving, and they have since canceled those plans, so he is going to be at the white house for the remainder of the week, as well as next week. in terms of where things go, the president has been firing top administration officials. he has also been meeting with his international team of advisors with regards to winding down military presence in the middle east as he has still been taking to twitter with regards to the results of the election the other week. it has been a transitional period, whether or not acknowledged, unlike one we have ever seen before. tom: how does he respond to a loss at the pennsylvania supreme court, etc.?

is there any reaction to those defeats, or are they ignoring the judicial system? kevin: i put this to a source yesterday who is very close to rudy giuliani. i said, where are the goods? where are the goods? you can't just talk about them. you've got to have court documents. you've got to have precise accusations. the source didn't have anything for me. there is acknowledgment around people like rudy giuliani, officialsior campaign that this is going nowhere fast, but there also is another acknowledgment that there is also a political strategy here. from the trump perspective, it is what is the longer play, not just for president trump, but also for members of the first family. what is their play going to be? and then obviously, the georgia runoff. jonathan: this is important. you've got to talk about the objective here, the primary objective. for most people, a contested election, ok. you are talking about separate objectives as well.

shine a little light on that for us. kevin: from the trump family perspective, what is the next play over the next 12 to 15 months? from the rnc perspective, who will keep control just at the top, but who will have influence at the rnc as they head into midterm elections? from president trump's perspective, will he look to get involved in media circles, or what will he do as a kingmaker if you want to choose that route , or even be a force in 2024? then of course, it is from the party perspective of the rank-and-file members. how are they going to coalesce and reorganize? the first test of this is on january 5 in georgia, whether it is karl rove started to fund raise and put more money to try to be a force to be reckoned with in georgia, who is going to try to claim credit for those winds if the republicans win and keep control of the senate, and

there's a lot at stake for all of those various parties i mentioned and the senate majority leader mitch mcconnell. jonathan: there's an assumption in some places that after january 5, some daylight opens up between the republican party and the trump movement, so to speak. do you anticipate that will actually happen, given the implications that could have for the next two years, the next four years? kevin: no, and here's why. when i talk to sources and president trump's world of political advisors and whatnot, they are all trying to figure out what their long-term objectives are, and right now there's a lot of infighting because they don't know what each of their objectives are in terms of the strategy laid out in front of them. but i can also tell you, and i will make this point quick, is that there is a real deep belief that the republican party is in a position of strength heading into 2022, and because of that, that is why you are seeing a

bunch of fog, so to speak, trying to sort out where they all think they are going to end up, where they are going, and where they want to go. tom: i am dazzled by the idea that while you're on with us, we can hear the construction of your new office. [laughter] i just think it is great how you do that. lisa: i will say, that brings me to the here and now, which might be the drill. kevin: metaphoric. lisa: but also just to shift this transition to the here and you'veterms of policy, got yesterday, president trump saying he is going to have further withdrawal of troops from afghanistan, as well as from iraq, but on the financial side, the sec coming out with a proposal to delist chinese firms from u.s. stock exchanges if they don't meet certain accounting requirements. this is not necessarily going to get through before biden takes office. how much political pressure is there on the bided

administration to put something like this through, to finish it out given some of the concerns about china and the u.s.? and we alsoficant, got word that the chairman is going to be stepping down so there is now an opening for the biden administration to fill with regard to foreign policy. you heard this earlier this week, but the president-elect discussing matters of geopolitics in terms of joining international alliances. not just from the u.s.-china perspective, what i've got my on is north korea -- what i've got my ion is north korea because typically, north korea tests missiles shortly after any type of inauguration. they waited about three weeks after president trump was inaugurated, so that could be front and center in february of next calendar year. jonathan: kevin, great to catch up, as always. kevin cirilli, bloomberg chief washington correspondent. let's talk about the reality of the moment. it is the virus in the united

states of america, and the extra restrictions we saw yesterday from place is like illinois, closing down quickly. we are seeing this in europe. we saw it happen two months ago. this is where it starts, with dining,in restaurant those kind of things. then you have to do more. tom: folks, we are getting up and the first.m., thing all three of us look at is the virus update. the virus update today is different than april or may. it is just as grim. there's no other way to put it. the swedish experiment is over. jonathan: that failed, yep. tom: belgium is worse. bulgaria has doubled their deaths in 14 days. it is across the united states as well. this is a news item that overwhelms every other news item. jonathan: without a doubt. covid rates have increased in all 50 states in the last two weeks, and in some places it has

been really concentrated and absolutely terrible. what we are starting to see is some real urgency now from the officials in these states, in these studies, trying to do something about this ahead of thanksgiving. that is where the urgency is at the moment. lisa: i would argue that is why you are not seeing a pop and markets the way that you did last week after the pfizer news came out initially. we got this incredible confirmation of the pfizer data, barely any moving equity -- es.ely any move in equiti the damage could have longer-lasting ramifications. jonathan: i sound like a broken record. it is that tug-of-war between the near-term outlook and the brighter forward outlook. i know you think i sound like a broken record anyway, tom. [laughter] tom: seriously, we are doing the out a check in a moment -- doing the data check any moment. 0.3%, up 12tures up on the s&p 500.

lisa said this yesterday, treasuries, the price action muted. i think that is the story we've got to focus on. equities to the moon in the last week. treasuries are not playing ball. from london and new york, this is bloomberg. ♪

jonathan: from london and new york, this is "bloomberg surveillance." good morning to you all. just a little bit more good news, this time from pfizer in their final analysis for the efficacy of their vaccine in that trial, 95%. nasdaq futures underperform, small caps outperform. the russell up 0.7%. we have become familiar with the flavor of the story over the past couple of weeks. switch up the board. this is one of those rotation plays into the financials, and it has really performed quite nicely over the last month, not just in europe, but the united states, too. here's the story. thanks, what are they doing? borrow short, lend long. just that classic spread lending story, which is why the bond market is the proxy for the banks. play it through the bond market. you see the yield curve start to steepen out.

the financial start to perform. what's happened in the last month? not what you might expect. last monday, twos-tens yield curve just south of 70 basis points. yield,urve up, steeper treasuries higher, and then we fade the move over the last week or so. the bond market has not participated in that banks rally. do you need it to? that is the question right now. that yield curve right now, 69 basis points, almost exact a where it was last monday at the open. tom: there's some real nuances you don't see in that chart. for those of you on bloomberg radio, the dynamic has been a persistency to a flatter curve. part of the dynamics of the market which folds in monetary, fiscal, and investment in financial analysis. k cushman -- michael ushma brings academic chops to morgan stanley, where he is the cio of global fixed income.

want to start with the monetary mystery of december and january. is it simply chairman powell to the rescue? michael: i think that is a lot of it. i think the fed has been clear about its intentions to support, provide accommodation, more accommodation if necessary to get us to a stronger economy down the road. they obviously can't put money directly in people's pockets, but they can do every possible measure to ensure the cost of ,oney in people's pockets whether it is through the corporate sector or the u.s. government. the melding of policy into economics right now. what is the most efficacious policy to get us out to where these vaccines click in, of this balance of fiscal, monetary, budgetary, and outright policy? what is the best mix forward? the best -- michael:

mix is accommodation. the federal government can provide that direct support, and the fed can help them along the way by buying the debt that the u.s. government produces in order to put money into people's pockets along the way. so it is a joint effort, a combined effort, and it could flounder or temporarily go sideways when one of the three elements is also health care policy. clear fed has been quite that they expect the federal government to hopefully provide more income support to the economy as a whole during this transition period to a vaccine. lisa: i am wondering, given the fact that there is incredible side support, there aren't a lot of organs out there given how high asset prices are. -- incredible fed support, there aren't a lot of bargains out there, and how high asset prices are. what do you do? michael: there's no doubt a lot

of good news in the future. if we think we will be on a stronger economic trajectory, there is no doubt given the monetary and fiscal support being provided and unlikely to withdraw through 2022 that interest rates, credit spreads should be at very low levels. high-yield bonds should be expensive. investment grade bonds should be expensive. equities should be high because of low interest rates around the world, particularly in the united states. it is not that bonds are at fair value, and that doesn't make them attractive. it is that should they just be a terry value -- just be at fair value, or well below historical fair value. hi spreads don't spend a lot of

time around average. they are either above average or below average because fundamentals are good, for namenda's are bad relative to average -- fundamentals are good , fundamentals are bad relative to average. we think that will cause spreads to be below-average by the end of next year. difficult will it be to push that view through the yield curve, looking for a steeper one at that? i understand we have had a one-way move since the end of february, when we were down by 10, 11 basis points. we statement out aggressively -- we steepened out over the last amount of months aggressively. why? michael: i think there's two limits. one is technical, this idea of a stephen yield curve has been in place for a while. -- idea of a steeper yield curve has been in place for a while. the rise of the pandemic, the

es hasf infection rat unnerved people. it could be easily true that in december, the fed announces an adjustment to their quantitative , so there's an issue into the end of this year that they will adjust their policies because fiscal policy is now an active. secondly, the pandemic has gotten worse. they may feel compelled to do something, and what they are like to do is increase buying of long-term bonds, which reduces the pressure for steepening. jonathan: this conversation belongs in the future. many parts of this market living in the future in 2021. we want to turn to the here and now and cross over to berlin. when we start to see more restrictions in europe, what we notice this time around was pushed back, more pushback and more resilience. that is what you see on the streets of berlin today. back in spring, it was widely accepted to go through a locked

down, to go through restrictions, to ultimately at some point end up wearing masks. what we have noticed across europe and many other places around the world as well, this time when the government has tried to lock things down, the pushback has been so much greater then what we saw six months ago, and that is what is difficult about living too far in the future, ignoring where we are right now. in berlin, where there are protests on the street, and the german police are firing a water cannon at the demonstrators because they will not adhere to social distancing, they do not want to wear masks, and they do not want to be locked down, how do you live in a better future in 2021 if we are still grappling with difficulty not only in europe, but in the united states as well? tom: it is called a pandemic, they are all the same, going back in time. gardner's one volume on you on sebastian bach bach, andnn sebastian

we are about at chapter 18 of the plague. it is that simple, there is societal protest. there is no other way to put it. we have the water cannon being used moments ago in berlin. it is a little more testy than it was two hours ago. jonathan: police in riot gear on the streets of europe, trying to deal with the demonstrators. i just wonder as we go through this moment around the world, a difficult moment through the back end of this year, how much can the market live in the back end of 2021 given the difficult to playing out right in front of us? michael: it is a good question. i think it is all about the length of time. if you think about evaluating a long dated asset, whether it is in equity or fixed income security, we are talking about five or six years of cash flows. if cash flows are damaged for a short time, and not to disastrously, then you would look through it.

when you see big losses in book value and the stock price goes up. the same thing is happening now. if you have a company or a situation where this is not that bad, they can get through this, and the longer term prospects are bright, you will look through it. the longer this lasts, the more damage it does to the u.s. economy, which is clearly what the fed is concerned with. worst cash flows are hammered. that has a bigger impact on the long-term value of these assets. that is the challenge, meaning competent, keeping the economy running at a reasonable pace, keeping money in people's pockets so that even if they are not spending it today, when the gates are lifted, there is money in people's pockets, whether it is the corporate sector, the household sector. they can go out and spend. that is when you have a very strong pop down the road, which compensates, at least in theory, for the weakness we are seeing now.

jonathan: great to catch up with you. we have talked so money times over the last week about the tug-of-war between the brighter outlook and the darker reality right in front of us short-term, and this is why it is so difficult. the next three months come which most leaders around the world will tell you is going to be difficult in europe and the united states, and what we need to do is a whole bunch of things. restrictions, social distancing, wear a mask, all of that. but if you are going to tell people to stay at home, you need to provide them with aid. this is the reaction in germany, where there is aid. imagine what could take place in ife united states they do not get their act together in washington. this is all great talk. here is what has shifted. i would suggest we are beginning to wait for another monetary solution rather than a fiscal solution. again, i give credit to standard

chartered way out front on this. onare up against 30,000 here dow futures. that is a big deal. i know you are not going to wear a dow jones 30,000 hat, but they are already ready to go. jonathan: we know the market is fine. we know financial conditions are loose, and we know why. because the fed is in the market. the ecb is in the market. boe is in the market. what is the offset to income? tom: i don't think there is any. the only thing that i think is going to solve it is going to be a turnaround in the job economy, where the unemployment weight -- the end and live it right or other statistics go work thomas -- the unemployment rate or other statistics go worse on us. lisa: that is some of the support that has been propping up consumer spending. that is going to go away at the end of the year if there is not

a re-upping. i was really struck by christine lagarde of the ecb yesterday coming out and saying the vaccine is not a game changer when it comes to longer-term growth. longer-term growth is still slower as a result of the pandemic. sobering. jonathan: very sobering for a thought right now. alongside tom keene and lisa abramowicz, i'm jonathan ferro. coming up on the program, joe telseyn of the advisory group. this is bloomberg. ritika: with the first word news, i'm ritika gupta. the way has been cleared for pfizer to apply for emergency approval of its coronavirus vaccine. the drugmaker says the final analysis of clinical trial showed the vaccine was 95% effective and had no serious side effects. pfizer developed the vaccine with its partner biontech. homeland security official lebb publicly

contradicted president trump's remarks about election fraud, and last night, those remarks cost him his job. his agency called the 2020 election "the most secure ever." president trump may come look at joe biden's plans to impose tougher regulations on wall street banks. he plans to nominate the acting comptroller of the currency to a five-year term. if the senate confirms brooks come biden might try to rely on never used legal authority to try to remove him once he is in the white house. and it is the biggest change to apple's app store revenue structure since it opened in 2008. apple is cutting back half of the fees charged to most developers who sell software and services. the company has faced scrutiny from government regulators about the percentage of revenue it takes for app store purchases. global news 24 hours a day, on air and on bloomberg quicktake, powered by more than 2700 journalists and analysts in more than 120 countries.

i'm ritika gupta. this is bloomberg. ♪

mr. biden: the messages america is back, and it is no longer america alone. been through ave

lot of damage done in the last four years, and we need to rebuild our institutions and our workforce with the full strength and diversity of our country. jonathan: president-elect joe biden speaking to national security and intelligence experts, virtually, of course. your magic number this morning, not high percent efficacy rate in the final trial data -- this morning, 95% efficacy rate in the final trial data. ,n a lift to the equity market a 14 on the s&p 500. the underperformance, small tech -- the underperformance, big tech. the outperformance, small cap. i will save that one for you, tom. in the bond market, yields up by about a basis point. 0.8685%.he 10 year to

after the epic rally in the energy space in equities, the commodity market, $42.44 on wti. tom: we haven't said enough about your to date -- about your to date on this. nasdaq 100, with all the fancy us early in the year, up 32%. i look at the small-cap, you have been talking up russell. they are up 13% year to date. jonathan: energy over the last months, 25% gains. i know it has been badly beaten up, but that just speaks to the rotation. financials,nergy, small caps. the russell really outperforming. tom: lisa has been killing that with the exxon dividend she is rolling in, with a pop in exxon. lisa: i just go with oil. tom: right now, we consider boeing. we can make jokes, but this is not funny. brooke sutherland has been

brilliant on boeing, the travails of the 737 max. i am going to cut to what my father told me years ago. follow the flight attendants. what will they do? will they get on this plane? brooke: i think they will. there's a lot of questions out there, and i completely understand, but i thick is worth remember think that this took 20 months. it is the longest ever grounding of a plane. i think whatever problems there were on this jet, the faa has found it by now. this was a black mark on the faa that has raised a lot of questions about their agency's relationship with boeing, whether it was rigorous enough in its first review of the plane. the agency was one of the last to ground the max, and really got shown up by china and europe. they had every incentive to get this right, so i think at this point, you can feel fairly confident that this plane is in

fact safe. we will get our first test at the end of december. american airlines will be the first to put this into service. it looks like they will fly a miami to new york route, so if you want to celebrate new year's on board a max, you might just get your chance, tom. lisa: i've got to jump in here because it is almost quaint to think about some of the 737 issues. i say that with tongue-in-cheek, obviously. it was a very serious issue, yet we are dealing with a pandemic. no one wants to get on a jet on new year's eve because they are worried about someone sneezing the covid-19aving virus and spreading it to them. how much does this actually boost boeing's longer-term prospects, given the drag of the bend meant has had on the entire aviation industry? means that boeing can start delivering some of the max jets it built during this grounding, but as you say, it is one thing to be allowed to

deliver them. it is a different thing to have customers who want to take those planes. this is going to be a very difficult process. just the way these contracts are written with the airlines, if you have a plane that has been grounded for more than a year, the airlines have a lot of wiggle room. they can cancel these orders or delay the relay very -- delay the delivery significantly. right now, they still have planes in storage from the non-max fleet they are operating. they don't need a bunch of new deliveries coming in and dealing with everything that that entails. this is definitely going to be a long process. it is an important first step because it will at least make this possible to deliver, but i just don't see a lot of carriers being interested in taking new aircraft in the near term come out is why you are not really going to be looking at boeing generating positive cash flow until probably 2022. tom: are these computer fixes, or have they actually fixed the positioning of the engines

forward or aft on the wing? brooke: they have not changed the structural components of the airplane. the engines are still in the same place they were, but is why the software system that was blamed for the two crashes is still in place. they are making that system safer. it is reliant now on two sensors that have to agree before the system starts to react, and it can only push the plane's nose down one time. what happened in the crashes is you had it erroneous readings setting the system off multiple times, continually pushing the nose of the plane down, setting off all kinds of alerts that just overwhelmed pilots. another big part of this is that boeing didn't tell the pilots about the system before that who crashes, and now i think we are all very aware of this system, but certainly the pilots are going to have to do simulator training before they fight this airplane again. that is significant in several ways, not just from a safety

perspective, but a big selling point of this airplane for boeing was that it was so similar to their previous 737 models, so they argued that airlines didn't have to invest in all of this additional training. that obviously is no longer the case, which does sort of undercut some of the appeal of this airplane. jonathan: quickly, who is going to pay for that simulator training? brooke: i would imagine that boeing is going to pay for that. like i said, this was the failed pitch from the beginning, so all of a sudden they are not offering what was promised, so i would imagine much of that cost is going to fall on boeing. jonathan: before we let you go, just a final question going into year end on how well catalyzed for industry is right now, some of the major customers. brooke: the vaccine is a positive, but i don't think anyone in the aerospace industry is starry eyed about what the

near-term future looks like. i think this is going to be a very tough slog, and they are all prepared for that. there's a lot of time still before we get a vaccine widely available for a significant disruption to what is happening in airline traffic, but more importantly, it is not clear that all of this travel is going to come back. we have all gotten used to doing meetings remotely, doing conferences remotely. you don't necessarily need to travel for that, and that is the most lucrative part of these companies' business. international travel will take longer to come back then domestic capacity. matters for the manufacturers and their suppliers. jonathan: the wonderful brooke sutherland of bloomberg opinion, thank you. they stocked up by a little more than 5%. more improving news on the vaccine front this morning from pfizer. a 95% efficacy rate. alongside tom keene and lisa abramowicz, i'm jonathan ferro. much more still to come on this

equity market. , federated global chief investment officer. this is bloomberg. ♪ businesses today are looking to tomorrow.

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>> we have seen a massive momentum shift in the last week that we don't think investors should be ignoring. >> you're not going to get a continuation of this straight upward movement. there will be pullback. >> we expect a loss has people get back to normal. >> normal doesn't look like january of 2020. the world is different. >> people have money, and they want to spend, and they can spend, and i think they are going to. >> we are looking forward into what we think is going to be a very big 2021. >> this is "bloomberg surveillance" with tom keene, jonathan ferro, and lisa abramowicz. tom: good morning, everyone.